Joint Parties

§ 11 When a Person May Be Both Promisor and Promisee A contract may be formed between two or more persons acting as a unit and one or more but fewer than all of these persons, acting either singly or with other persons.

See also

§ 29 To Whom an Offer Is Addressed

(2) An offer may create a power of acceptance in a specified person or in one or more of a specified group or class of persons, acting separately or together, or in anyone or everyone who makes a specified promise or renders a specified performance.

CHAPTER 13 - JOINT AND SEVERAL PROMISORS AND PROMISEES

Topic 1 - Joint and Several Promisors

§ 288 Promises of the Same Performance (1) Where two or more parties to a contract make a promise or promises to the same promisee, the manifested intention of the parties determines whether they promise that the same performance or separate performances shall be given. (2) Unless a contrary intention is manifested, a promise by two or more promisors is a promise that the same performance shall be given.

§ 289 Joint, Several, and Joint and Several Promisors of the Same Performance (1) Where two or more parties to a contract promise the same performance to the same promisee, each is bound for the whole performance thereof, whether his duty is joint, several, or joint and several. (2) Where two or more parties to a contract promise the same performance to the same promisee, they incur only a joint duty unless an intention is manifested to create several duties or joint and several duties. (3) By statute in most states some or all promises which would otherwise create only joint duties create joint and several duties.

§ 290 Compulsory Joinder of Joint Promisors (1) By statute in most states where the distinction between joint duties and joint and several duties retains significance, an action can be maintained against one or more promisors who incur only a joint duty, even though other promisors subject to the same duty are not served with process. (2) In the absence of statute, an action can be maintained against promisors who incur only a joint duty without joinder of those beyond the jurisdiction of the court, the representatives of deceased promisors, or those against whom the duty is not enforceable at the time of suit.

§ 291 Judgment in an Action Against Co-Promisors In an action against promisors of the same performance, whether their duties are joint, several, or joint and several, judgment can properly be entered for or against one even though no judgment or a different judgment is entered with respect to another, except that judgment for one and against another is improper where there has been a determination on the merits and the liability of one cannot exist without the liability of the other. 

§ 292 Effect of Judgment for or Against Co-Promisors (1) A judgment against one or more promisors does not discharge other promisors of the same performance unless joinder of the other promisors is required by the rule stated in § 290. By statute in most states judgment against one promisor does not discharge co-promisors even where such joinder is required. (2) The effect of judgment for one or more promisors of the same performance is determined by the rules of res judicata relating to suretyship or vicarious liability.

§ 293 Effect of Performance or Satisfaction on Co-Promisors Full or partial performance or other satisfaction of the contractual duty of a promisor discharges the duty to the obligee of each other promisor of the same performance to the extent of the amount or value applied to the discharge of the duty of the promisor who renders it.

§ 294 Effect of Discharge on Co-Promisors (1) Except as stated in § 295, where the obligee of promises of the same performance discharges one promisor by release, rescission or accord and satisfaction, (a) co-promisors who are bound only by a joint duty are discharged unless the discharged promisor is a surety for the co-promisor; (b) co-promisors who are bound by joint and several duties or by several duties are not discharged except to the extent required by the law of suretyship. (2) By statute in many states a discharge of one promisor does not discharge other promisors of the same performance except to the extent required by the law of suretyship. (3) Any consideration received by the obligee for discharge of one promisor discharges the duty of each other promisor of the same performance to the extent of the amount or value received. An agreement to the contrary is not effective unless it is made with a surety and expressly preserves the duty of his principal.

§ 295 Effect of Contract Not to Sue; Reservation of Rights (1) Where the obligee of promises of the same performance contracts not to sue one promisor, the other promisors are not discharged except to the extent required by the law of suretyship. (2) Words which purport to release or discharge a promisor and also to reserve rights against other promisors of the same performance have the effect of a contract not to sue rather than a release or discharge. (3) Any consideration received by the obligee for a contract not to sue one promisor discharges the duty of each other promisor of the same performance to the extent of the amount or value received. An agreement to the contrary is not effective unless it is made with a surety and expressly preserves the duty of his principal.

§ 296 Survivorship of Joint Duties On the death of one of two or more promisors of the same performance in a contract, the estate of the deceased promisor is bound by the contract, whether the duty was joint, several, or joint and several. 

Topic 2 - Joint and Several Promisees

§ 297 Obligees of the Same Promised Peformance (1) Where a party to a contract makes a promise to two or more promisees or for the benefit of two or more beneficiaries, the manifested intention of the parties determines whether he promises the same performance to all, a separate performance to each, or some combination. (2) Except to the extent that a different intention is manifested or that the interests of the obligees in the performance or in the remedies for breach are distinct, the rights of obligees of the same performance are joint.

§ 298 Compulsory Joinder of Joint Obligees (1) In an action based on a joint right created by a promise, the promisor by making appropriate objection can prevent recovery of judgment against him unless there are joined either as plaintiffs or as defendants all the surviving joint obligees. (2) Except in actions on negotiable instruments and except as stated in § 300, any joint obligee unless limited by agreement may sue in the name of all the joint obligees for the enforcement of the promise by a money judgment.

§ 299 Discharge by or Tender to One Joint Obligee Except where the promise is made in a negotiable instrument and except as stated in § 300, any joint obligee, unless limited by agreement, has power to discharge the promisor by receipt of the promised performance or by release or otherwise, and tender to one joint obligee is equivalent to a tender to all.

§ 300 Effect of Violation of Duty to a Co-Obligee (1) If an obligee attempts or threatens to discharge the promisor in violation of his duty to a co-obligee of the same performance, the co-obligee may obtain an injunction forbidding the discharge. (2) A discharge of the promisor by an obligee in violation of his duty to a co-obligee of the same performance is voidable to the extent necessary to protect the co-obligee's interest in the performance, except to the extent that the promisor has given value or otherwise changed his position in good faith and without knowledge or reason to know of the violation.

§ 301 Survivorship of Joint Rights On the death of a joint obligee, unless a contrary intention was manifested, the surviving obligees are solely entitled as against the promisor to receive performance, to discharge the promisor, or to sue for the enforcement of the promise by a money judgment. On the death of the last surviving obligee, only his estate is so entitled.

See also

Article 154. Contracts and Unilateral Transactions

1. Transactions may be bilateral or multilateral (contracts), or unilateral.

Article 308. Parties to Obligation

1. One or simultaneously several persons may participate in an obligation as each of its parties, i.e. creditor or debtor.

The invalidity of the creditor's claims with regard to one of the persons participating in an obligation as a debtor, and likewise the expiry of the limitation period with regard to the claim against such person, shall not in and of itself affect his claims against the other such persons.

2. If each of the parties to a contract bears a duty in favor of the other party, it shall be considered the debtor of the other party in what it is obliged to do to the its benefit and, simultaneously, the creditor thereof in what it has the right to demand from it.

3. An obligation shall not create duties for persons who are not participating therein as parties (for third persons).

In the instances provided for by a law, other legal acts, or by agreement of the parties, an obligation may create rights for third persons with respect to one or both parties to the obligation.

Article 321. Discharge of the Obligation, in Which Several Creditors or Several Debtors Participate

Article 321. Discharge of the Obligation, in Which Several Creditors or Several Debtors Participate

If several creditors or several debtors take part in the obligation, each of the creditors shall have the right to claim the discharge, and each of the debtors shall be obliged to discharge the obligation in an equal share with the others, unless otherwise following from the law, from the other legal acts, or from the terms of the obligation. 

Article 322. Joint Obligations

1. The joint duty (the liability), or the joint claim shall arise, if the joint nature of the duty or of the claim has been stipulated by the contract or has been established by the law, in particular, in the case of the indivisibility of the object of the obligation. 2. The duties of several debtors by the obligation, involved in the business activity, the same as the claims of several creditors in such an obligation, shall be joint ones, unless otherwise stipulated by the law, by the other legal acts, or by the terms of the obligation. 

Article 323. The Creditor's Rights in the Joint Duty

1. In case of the debtors' joint duty, the creditor shall have the right to claim the discharge both from all the debtors jointly, and also from any one of them taken apart, and both in full and in the part of the debt. 2. The creditor, who has not been fully satisfied by one of the joint debtors, shall have the right to claim the rest from the joint debtors. The joint debtors shall stay obligated until the moment, when the obligation has been discharged in full. 

Article 324. Objections to the Creditor's Claims in the Joint Duty

In the case of the joint duty, the debtor shall not have the right to put forward against the creditor's claims the objections, which are based on such relations of the other debtors with the creditor, in which the said debtor does not participate.

Article 325. Discharge of the Joint Duty by One of the Debtors

1. The discharge of the joint duty in full by one of the debtors shall absolve the rest of the debtors from the discharge toward the creditor. 2. Unless otherwise following from the relations between the joint debtors:

1) the debtor, who has discharged the joint duty, shall have the right of the claim of regress to the rest of the debtors in equal shares, less his own share;

2) that which has not been paid by one of the joint debtors to the debtor, who has discharged the joint duty, shall fall in equal shares on this debtor and on the rest of the debtors. 3. The rules of the present Article shall be applied correspondingly to the termination of the joint obligation by offsetting the claim of regress, filed by one of the debtors.

Article 326. The Joint Claims

1. In the case of the joint claims, any of the joint creditors shall have the right to present to the debtor the claim in the full volume. Before the claim has been presented by one of the joint creditors, the debtor shall have the right to discharge the obligation toward any one of them at his own discretion. 2. The debtor shall not have the right to put forward the objections against the claim of one of the creditors, that are based on such relations of the debtor with the other joint creditor, in which the given creditor does not take part. 3. The discharge of the obligations in full toward one of the creditors shall absolve the debtor from the discharge toward the other creditors. 4. The joint creditor, who has accepted the discharge from the debtor, shall be obliged to recompense what is due to the other creditors in equal shares, unless otherwise following from the relationships between them.